Tips to Save Money on Auto Insurance
One of the most significant budget items you can have is car insurance. This is particularly true if you have more than one vehicle. Numerous factors determine what your final cost will be. Where you live, how often you drive, whether you are driving for work or personal reasons, your driving history, type of vehicle – the list goes on. Finding ways to save on your auto insurance should be a top priority. Here are a few ways to reduce your auto insurance bill.
Bundle Homeowners and Auto Insurance Policies
Many insurance companies will allow you to combine both of these policies if you purchase insurance from the same source. Buying a combination package that will cover both your home and vehicles will help you save substantially over independent policies. If you purchase home and auto insurance policies through separate companies, you are missing out on an excellent opportunity to reduce costs.
If you have a rainy day account and are in good financial shape, consider raising your deductibles. Doing this will directly impact the cost of your premiums. Often, if you raise your deductible from $500 to $1000, the $500 is paid for in just about a year. After year one, place that money into your emergency fund to cover any expenses you may occur if you happen to be in an accident.
Improve Your Credit
This may seem unrelated, but your credit can have an effect on your insurance premiums. Auto insurance companies factor in many different things when establishing how risky a driver you are. If you have credit issues, this can be perceived that you are prone to risky behavior. Keep your bills paid on time and work on lowering your credit card debt.
Review Your coverage
If you have an older vehicle, it might be wise to remove collision coverage and go with just liability coverage. A good rule of thumb is if your vehicle’s trade-in value is $1000 (or less), you should go with liability coverage. A car with that low of a trade-in value is nearing the point of replacement anyway. The cash value of your vehicle is probably not much more than it’s scrap value. Don’t waste money on collision insurance expecting to replace it.
Buy the Right Car
Did you know insurers take into account the type of vehicle you own, even down to the color? For example, a flame-red Camaro is going to have a significantly higher premium than a silver Honda Odyssey. Why is this? Because aggressive colors like red are often linked to aggressive drivers. Vans are considered to be owned by someone in a stable and secure situation.
Pay Premium Annually
If you are dividing your premium into semiannual, quarterly, or monthly payments, you are likely paying a processing fee. Save yourself these fees by putting aside what you would pay into an interest-bearing account.
Remember, we are here to help make sure you get the best coverage for your hard-earned dollars. Contact our insurance offices in Hanover, PA today, and let’s review how we can help you save money on your auto insurance.